With all purchases in life, no one wants to be paying more than they should for a product or a service. This is especially important when it comes to a retirement nest egg. Financial wealth management advisor Mike Reeves of Strategic Wealth Designers joined the morning show to highlight some easy tells in the financial service industry for excessive fees.
“The first easy question to ask is, are you a fiduciary financial advisor or are you working under the suitability standard,” Reeves says. “The problem is some financial firms out there register as both so you don’t know when they are working in your best interest and when they are working in theirs. Far too often we see advisors putting investors in high-fee products because they are suitable but really not the best choice for the client.”
1% may not feel like a lot of money in the course of a year but when you have a portfolio of $500,000 or $1,000,000 dollars, over the course of 10 to 20 years 1% really adds up. Each year many investors are paying thousands of dollars more than they should be for financial advice. Reeves says working with a firm that is focused on financial planning and not products is a good starting point.
“Many financial advisors jump into talking about this product or that product because their firm told them they have to sell a certain product that month.” Reeves says. “How can a financial advisor possibly know what is going to be best for that client without building a proper financial plan first. Working through the goals for the money, how much money someone holds and what their health is like, will all contribute to the best way to properly position their asset allocation.”